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Microsoft, Real Trading Fire

The software giant continued its counter-attack against allegations made by rival RealNetworks.

WASHINGTON -- In the eighth week of the trial to determine what penalties should be imposed against Microsoft Corp. for its anti-competitive behavior, the Redmond, Wash., company continued its counter-attack against allegations made by rival software developer RealNetworks Inc.

Will Poole, a Microsoft vice president who began his court testimony late last week,, said that RealOne Player would no longer work with Windows if all the multimedia interfaces were removed, per the states proposed remedy requirements, but RealNetworks had challenged that assertion.

In his testimony, Poole emphasized that Microsofts efforts to turn Windows into a platform for multimedia applications was not motivated by an effort to exclude competitors. Poole testified that Microsoft announced the development of Multimedia Extensions for Windows 3.0 four years before RealNetworks existed. According to Microsoft spokesman Jim Desler, Microsoft began working on digital media and integrating multimedia technology into versions of Windows before Rob Glaser, RealNetworks CEO, left Microsoft to create his own company.

During his cross-examination, John Schmidtlein, attorney for the District of Columbia and nine states pursuing tough remedies, questioned Poole about the degree to which Microsoft considered the courts findings of anti-competitive conduct when it designed Windows Media Player, Windows XP and the interfaces between them.

Further reading

When Schmidtlein pressed him about whether Microsoft changed the design of Windows Media Player in light of the courts findings, Poole said he was not aware of any specific design alterations. "But changes in design of this code happen every day without my knowledge or the knowledge of the people working directly for me," he added.

Trying to demonstrate that Microsoft could treat OEMs in a discriminatory fashion despite a provision banning such behavior in the federal anti-trust settlement proposal agreed to in November, Schmidtlein showed an internal Microsoft email from Aug. 31, 2001 regarding marketing strategies. "[Jim Allchin and Will Poole] want to pull back on [first half] marketing commitments to OEMS for Oct. 25th and redistribute that money to OEMs that are shipping all of XP," the email read.

Linda Averett, product unit manager for Windows Media Player at Microsoft, took the stand today, largely to contest allegations brought earlier in the trial by David Richards, RealNetworks vice president of consumer systems. Among other things, RealNetworks complained that compatibility problems were created because Microsoft did not disclose technical information regarding Windows XP earlier.

Right now, as part of its compliance with the proposed anti-trust settlement inked with the Department of Justice in November, Microsoft is trying to determine all internal Windows interfaces that Media Player relies on, according to Averett.

Schmidtlein grilled Averett on the backward compatibility of digital media functionalities in Windows. Specifically, Schmidtlein asked her whether the new functionalities run on Windows 95, which is still widely used by enterprises. Schmidtlein showed an internal Microsoft email from February, 2002, in which an official in the business development division noted in the subject field that as of last October, approximately 50 percent of business PCs used Windows 95. "Im taking my life into my own hands with a subject line like that, arent I," the email writer said.

Averett responded that it would take "enormous work" that would be "fraught with the likelihood of peril" to try to bring Windows 95 up to date with digital media technology.

RealNetworks complained that there are occasions when Microsoft overrides users choice of the default media player in XP. According to Averett, Microsoft intended that XP would be passive as far as the takeover of files during upgrade goes. But after XP was released commercially, Microsoft discovered a bug that causes Media Player to take over file types that were traditionally owned by Windows during an upgrade. That bug, and another, is being corrected in the Service Pack 1 for XP, Averett said in her written testimony.

"RealNetworks was on notice of the things it is complaining about now long before the launch of Windows XP because the functionality was exposed in the final test versions of Windows XP referred to as release candidates," Averett wrote in her testimony. "RealNetworks received those release candidates for testing, and was free to modify its products to make them compatible with Windows XP."

Microsoft is slated to wrap up its witnesses this week or early next week, having only three more to call to the stand after cutting back on its original lengthy roster. After Averett, Microsoft plans to call Jim Allchin, group vice president of Microsofts Platforms Division and two professors.

Judge Colleen Kollar-Kotelly is considering to what degree the states will be allowed to present a rebuttal to Microsofts witnesses. The states want to bring Andrew Appel, a computer sciences professor, back to the stand to explain how the term "middleware" could be effectively applied in the states remedy and how Microsoft could comply with the proposed requirement of a modular Windows, i.e., an operating system unbundled from middleware. They also want to call to the stand James Bach, an independent software tester in Front Royal, Va., to describe the feasibility of removing middleware from the operating system. Microsoft is opposing additional appearances by witnesses for the states.

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